Former Fed building in Downtown Pittsburgh will be hotel

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There is an answer to whether the former Federal Reserve Bank building Downtown will be turned into offices or a hotel.

Crews will begin remodeling the Downtown building next November into a Drury Inn & Suites with 180 rooms and the work should be complete by November 2015, Joe Pereles, vice president of Drury Hotel Co. said on Friday.

The subsidiary of Drury Southwest Inc. will operate the hotel when its sale by M&J Wilkow of Chicago closes in a couple of weeks, Pereles said. No price was disclosed.

The estimated $30 million project will mark Drury's entrance into the Pittsburgh market, an area the company has eyed for some time, Pereles said. The Drury Inn & Suites model is similar to a Hampton Inn or Courtyard by Marriott, he said.

“We recently purchased a building in Cleveland, and our historic restoration crew will be going there to have that building converted into a hotel,” Pereles said. “Following that conversion, the team will come to Pittsburgh.”

Drury is scheduled to go before the Pittsburgh Zoning Board of Adjustment on Nov. 21 to obtain approval to place two projecting signs on both sides of the building.

Strada Architecture of Pittsburgh, which is working on changes to the building, believes Drury will attempt to preserve most of the first-floor structural design.

“Above the first floor it is mostly typical offices, and those floors will be probably changed a lot to meet the design of a hotel,” said Edward Shriver, a principal.

He isn't sure what use can be made of the four basement bank vaults — possibly storage — but doesn't think they will be removed. An eighth-floor firing range, however, likely won't survive the remodeling, Shriver said.

This marks the third Downtown office building that will convert all or part of its space to a hotel.

Hotel Monaco will open with 250 rooms in the former Reed Smith Building on Sixth Avenue, and McKnight Realty Partners is converting 11 floors of the 24-story Oliver Building on Smithfield Street into a 228-room Embassy Suites.

Drury Hotels is a family-owned business established in 1962, with 130 hotels in 20 states. Pittsburgh's will be its first in Pennsylvania.

M&J Wilkow purchased the Federal Reserve building in July from the Federal Reserve Bank of Cleveland for $3.75 million. M&J's vice president of acquisitions, Martin Sweeney, said shortly after the deal closed that a number of hotel operators, including four international companies, had inquired about turning the building into a “boutique” hotel.

M&J had intended to convert it for office use, and Sweeney had said he was talking with potential tenants.

The building has a three-story banking room that could become a hotel lobby. Its bank vaults could be utilized as dining rooms or fitness areas.

It has a rooftop deck and parking for 40 cars in the rear.

The building, designed by Walker and Weeks, a Cleveland-based architectural firm, opened in 1931 as a seven-story structure. In 1958, a 10-story addition was completed.

Until 1997, the Pittsburgh branch sorted worn currency from Western Pennsylvania banks, shredded bad bills and stored those fit for continued circulation until the money was sent to banks. The Cleveland bank took over those functions.

The building closed in 2012 and its staff of 25 moved to One Oxford Centre. At one time, the building housed 320 employees involved in the paper sale of U.S. Savings Bonds and other securities.

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